Tech Letter
The Hood Is Good
The crypto broker Robinhood (HOOD) and the stock is up 450% and if you believe in the digital crypto story, then this is the stock for you.
As macro volatility rears its ugly head in all corners of the globe, crypto trading volume has exploded and this is one of the main beneficiaries of the boom on the public markets in New York.
Bitcoin is trading around $110,000 per coin now and that has help propel a surge in revenue of 115% year-over-year to a record $1.01 billion, driven by a 700% increase in cryptocurrency trading revenue, which contributed 35% of total revenue.
It wouldn’t be fair to say at this point that Bitcoin is a flash in the pan and I do believe it is here to stay for the long haul.
Readers should be buyers of Bitcoin on large dips.
I find it fascinating that one of the few sub-sectors of tech that are working aside from semiconductor chips and Mag 7 are the crypto related stocks.
This is one of them to keep your eye on.
The acquisition of Bitstamp for $200 million in June 2025 has significantly enhanced Robinhood’s crypto offerings.
Robinhood has expanded beyond commission-free stock trading to include retirement accounts, a high-yield savings feature, a “gold” card with rewards, and a prediction-markets hub launched in May 2025.
The introduction of Robinhood Cortex, an AI-powered trading assistant, and plans for a subscription-based model inspired by Amazon and Costco, enhance user retention and revenue streams. These innovations have positioned Robinhood as a comprehensive financial platform, appealing to a broad user base.
Robinhood’s funded customers grew to 25.6 million by February 2025, up 2 million year-over-year, with assets under custody (AUC) increasing 99% to $221 billion.
Robinhood’s scalability and operational efficiency has been a main pillar of its business underpinned by a high gross margin of 71.2% and a software-driven business model that allows for significant margin expansion.
Robinhood’s strategic expansion into cryptocurrency is a game-changer. The $200 million acquisition of Bitstamp in June 2025 has bolstered its position in the crypto market, enabling it to offer a wider range of tradeable tokens and integrate advanced wallet features. Crypto trading volumes soared over 400% year-over-year in the 4th quarter, fueled by a bullish market following Bitcoin’s rise to $100,000.
Initiatives like the crypto deposit match program, offering a 1% match (potentially 2% if $500 million is transferred by July 7, 2025), demonstrate Robinhood’s ability to attract and retain users. With crypto contributing significantly to revenue, this segment positions Robinhood to benefit from the growing adoption of digital currencies, particularly as regulatory frameworks stabilize.
Robinhood’s diversification into new products and services enhances its appeal as a one-stop financial platform.
The company is really evolving its businesses and services to suits a future business world that is heavy in digital flavor.
The old economy is gone and digital assets will thrive in the new modern world.
If bitcoin crashed, it would have happened already, but all we have seen is sovereign nations embrace the asset.
HOOD has also marketed itself smartly as the “cool” broker which helped when they went commission free from the beginning.
Hood is a volatile stock, but I would be interested in this stock on big pullbacks.
I am bullish HOOD.
